When working out ones tax liability is the followoing the correct approach.
Total income = All incomes including Salary, rental, interest income, divident income and debt income + income from LTCG (equity shares) (ignoring other possibel income)
For the above the tax computation would be
A. Tax on LTCG = LTCG from equity less 1.25 Lakhs @ 12.5%
B. Total income minus LTCG from equity taxed per slab rates
C. Total income including LTCG will decide the surcharge, cess, interest and penalty on tax as applicable
Total Tax = A + B + C ? (final tax liable would be based on advance tax paid etc)
Q1) Is the above correct at a gross level? Is it the same if the gain is from LTCG on sale of property, Meaning its to be computed independently and then added to tax applicable to arrive at total tax ?
CAclubindia
